The UK's top blue-chip index rose 0.62 per cent, to 6,395 points.
Five participating banks – Barclays, HSBC, Lloyds Banking Group, Santander UK and the Nationwide building society – all passed the stress tests with no major concerns, while the other two - Standard Chartered and RBS - had already taken the necessary steps to boost their capital buffers in recent months, and were therefore not required to submit new plans to the regulator.
Barclays' share price rose 4.61 per cent to 233.5p, while RBS's stock rose 3.24 per cent to 312.2p per share and Lloyds' shares closed 2.4 per cent higher at 74.71p. HSBC's share price ended the session 1.79 per cent up at 349p per share.
However, Standard Chartered's share price fell marginally by 0.09 per cent to 556.7p.
“Bank executives must be breathing a sigh of relief ... It is reassuring for consumers and financial authorities to recognise that the industry has tightened up how it conducts its business," Head of risk solutions at SAS UK & Ireland Simon Goldsmith said.
Read more: FTSE 100 index closes down on Aberdeen Asset Management and BHP Billiton
Aberdeen Asset Management, however, slid 1.44 per cent to 314.8p per share as the Bank of England's plans for stress tests of asset management firms added to problems for the company, which yesterday announced a 12.5 per cent reduction in assets under management over the past year.
Meanwhile, in the FTSE 250, Petra Diamonds' share price rallied 12.63 per cent to close at 72.25p, on the confirmation of its Kimberley mine deal and news lenders had agreed to waive some covenant tests.
Drax also rose 13.2 per cent after the EU cleared state aid to convert the Lynemouth coal-fired power plant to biomass.